Charles D. Bonanno Linen Service

CHARLES D. BONANNO LINEN SERVICE Charles D. Bonanno Linen Service, Inc. and Team- sters Local Union No. 25, International Brother- hood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. Case I-CA-I 1628 May 12, 1977 DECISION AND ORDER BY CHAIRMAN FANNING AND MEMBERS JENKINS AND MURPHY On December 20, 1976, Administrative Law Judge James M. Fitzpatrick issued the attached Decision in this proceeding. Thereafter, Respondent filed excep- tions and a supporting brief, the Charging Party filed cross-exceptions and a supporting brief and also a brief in opposition to the Respondent's exceptions, and the General Counsel filed a brief in support of the Administrative Law Judge's Decision. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge and to adopt his recommended Order. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Administrative Law Judge and hereby orders that the Respondent, Charles D. Bonanno Linen Service, Inc., Medford, Massachu- setts, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order. DECISION STATEMENT OF THE CASE JAMES M. FITZPATRICK, Administrative Law Judge: The main question in this case is whether one employer, of a group negotiating with a union, may, by leaving the group during a bargaining impasse, avoid obligations under the contract later agreed on between the Union and the remainder of the group. As set out hereinafter, I find the withdrawing employer is bound by the contract because circumstances were not so unusual as to justify withdrawal where the union has not consented. The other nine are Bristol Coat & Apron Service Co.: I.oyal Crown Linen Service, Inc.: Delaney Linen Sernice, Inc.; Federal National Linen Service Co.: Independent Leasing Corporation: Gilman Towel Supply Co.. 229 NLRB No. 108 The case arises from unfair labor practice charges filed on April 9, 1976, by Teamsters Local Union No. 25, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (herein the Union). A complaint based on the charges issued May 20, 1976, alleging that Charles D. Bonanno Linen Service, Inc. (herein Bonanno), engaged in unfair labor practices within the meaning of Section 8(aX5) and (1) of the Act by refusing to execute a collective-bargaining agreement negotiated between the Union and a group of employers after Bonanno purported to withdraw from the group. Bonanno answered, admitting jurisdictional allegations, the authority of the group to bargain on behalf of member- employers, including Bonanno, and the attempt of Bonan- no to revoke that authority. Bonanno denied the balance of the allegations, including legal conclusions that it engaged in unfair labor practices. The case was heard before me at Boston, Massachusetts, on August 30, 1976. Based on the entire record, including my observation of the witnesses, and consideration of excellent briefs from the parties, I make the following: FINDINGS OF FACT I. THE EMPLOYERS INVOLVED Bonanno is a Massachusetts corporation engaged at Medford, Massachusetts, in the laundering, rental, and distribution of linen, uniforms, and related products. In the operation of its business it annually receives at its Medford plant from points outside Massachusetts chemicals, linens, and other fabrics valued over $50,000. Its annual gross receipts exceed $500,000. The complaint alleges, the answer admits, and I find that Bonanno is an employer engaged in commerce within the meaning of the Act. The New England Linen Supply Association (the Group) is comprised of 10 employers, including Bonanno, engaged in the linen service business.' II. THE LABOR RELATIONS A. Background The Union is a labor organization within the meaning of Section 2(5) of the Act. It represents the truckdrivers and helpers employed by Group members. The parties stipulate that the employees so represented constitute an appropri- ate bargaining unit. For some years past the 10 employers referred to above have negotiated as a group with the Union respecting the terms of employment of their drivers and helpers. On September 21, 1972, they signed individual and identical agreements with the Union which were to remain in effect until April 18, 1975, and thereafter until amended by mutual agreement or terminated in accordance with a provision that "either party desiring to amend or terminate the contract shall on or after February 15, 1975 notify the other party in writing of said intention." Inc.; Morgan Services, Inc.: Norfolk Count) Linen Service: and Standard Linen Service. 629 DECISIONS OF NATIONAL LABOR RELATIONS BOARD B. Negotiations for a Current Contract On or about February 19, 1975, Bonanno authorized the Group to bargain collectively on its behalf with the Union and, subsequently, such bargaining took place. On March 14, 1975, apparently in anticipation of possible termination of the existing agreements but without formal notification thereof, the Union and the Group met for their first negotiating session looking toward a new agreement. Thereafter, they held further negotiating meetings on March 19 and 26 and April 1, 3, 11, 13, 14, 16, 17, and 30. In the meantime, on April 18 the Union by letter notified each member of the Group that it was giving 60-day notice of termination pursuant to the terms of the 1972 agree- ments. On April 23, 1975, the attorney representing the Group by letter offered to meet with the Union for the purpose of negotiating a new agreement. On April 30, 1975, the negotiators reached agreement, subject to ratification by the employees, which provided for compensation to employees on an hourly basis. On May 4, 1975, the employees voted to reject the contract. The negotiators next met on May 12, at which time the Union proposed that employees be compensated on a commission basis rather than at an hourly rate. Group negotiators rejected this proposal, adhering to the position previously taken. The negotiators again met on May 15 and the Union again insisted on pay on a commission basis. Management negotiators again rejected the proposal, advising the Union that they would accept a strike rather than concede on the issue. At a further session on May 20 the positions of the parties remained unchanged. It is undisputed that an impasse on this issue had been reached on May 15. A further meeting on June 18 was unsuccessful in breaking the impasse. C. The Strike and Lockout On June 23, 1975, the impasse continuing, the Union called a selective strike against Bonanno in which all of its drivers participated. At the time of the hearing that strike was still in effect. The fact that the Union struck only Bonanno is not a circumstance which justified Bonanno's later withdrawal from the Group. Selective strikes are a legitimate tactic for exerting economic pressure. Their occurrence does not relieve a struck employer of his obligation to bargain with the Union. See Beck Engraving Co., Inc., 213 NLRB 53, 54-55 (1974), enforcement denied 522 F.2d 475 (C.A. 3, 1975); State Electric Service, Inc., 198 NLRB 592, 593 (1972); Hi-Way Billboards, Inc., 206 NLRB 22, 23 (1973), supplementing 191 NLRB 244 (1971), enforcement denied 500 F.2d 181 (C.A. 5, 1974). After the strike began, most of the other employers in the Group locked out their drivers, thus presenting a united front to the Union. The parties continued to meet, however, in an effort to reach an agreement. Negotiating sessions were held on July 22, August 15, and September 2, 1975. But impasse continued on the issue of method of payment to drivers. The Union argues that because some employers during strategy sessions urged that a sky-high wage offer be made 2 Nothing in the record suggests that it was the Union that made the secret overtures. In any case, the Union did not make any agreement with the wayward employers. in an effort to break the impasse, a tactic which Bonanno opposed, a potential break in the impasse was apparent and therefore continuation of the impasse should not be viewed as a legitimate reason for Bonanno withdrawing from group bargaining. There is no merit to this conten- tion. Remarks made during strategy sessions could have only the most speculative impact on the actual bargaining situation. Of greater significance is the fact that, before Bonanno withdrew, two other employers in the Group secretly had been in direct touch with the Union, presumably in an effort to make a separate settlement.2 Nothing came of these secret contacts. Whether they reached the level of negotiations does not appear. In the circumstances, I find the Group was not thereby fractured in a manner warranting withdrawal by others in the Group. See Ice Cream, Frozen Custard Industry Employees, Drivers, Ven- dors and Allied Workers Union Local 717, et al. (Ice Cream Council, Inc.), 145 NLRB 865, 870 (1964). D. The Respondent's Withdrawal from the Group On November 21, 1975, the strike and lockout still being in effect and the impasse continuing, Bonanno revoked its prior authorization to the Group to bargain on its behalf, stating, "The Company is withdrawing from the Associa- tion with specific respect to negotiations at this time because of an ongoing impasse with Teamsters Local 25." Bonanno indicated it would engage in bargaining directly with the Union. A copy of its revocation letter was mailed to the Union on November 21 and that same day read to a union representative over the telephone. Between commencement of the strike on June 23 and the notice of withdrawal on November 21 Bonanno hired permanent replacements for all of its striking drivers. Thus, from its point of view there was less reason than earlier to continue with group bargaining. But the difference in personnel was not such a circumstance as would justify withdrawal from the Group because the hiring of replace- ments was a logical outgrowth of the strike and a normal management effort to survive. N.L.R.B. v. MacKay Radio & Telegraph Co., 304 U.S. 333 (1938). Use of such normal measures are not "unusual circumstances" which justify withdrawal from group bargaining. Bonanno strongly urges that the ongoing impasse was an unusual circumstance justifying its withdrawal from the Group in accordance with the Board's decision in Retail Associates, Inc., 120 NLRB 388, 393-395 (1958). It especially relies on four court of appeals decisions so holding. See N.LR.B. v. Beck Engraving Co., 522 F.2d 475 (C.A. 3, 1975); N.LR.B. v. Associated Shower Door Co., Inc., 512 F.2d 230 (C.A. 9, 1975); N.LR.B. v. Hi-Way Billboards, Inc., 500 F.2d 181 (C.A. 5, 1974); and Fairmont Foods Company v. N.L.R.B., 471 F.2d 1170 (C.A. 8, 1972). See also the dictum of the First Circuit in N.LR.B. v. Field and Sons, Inc., 462 F.2d 748 (1972). The General Counsel and the Union point out that the Board has not followed the line taken by the courts of appeals. Under Board law a bargaining impasse does not 630 CHARLES D. BONANNO LINEN SERVICE constitute such an unusual circumstance as to justify an employer's unilateral withdrawal from group bargaining. See Hi-Way Billboards, Inc., 206 NLRB 22 (1973), on remand from N.L.R.B. v. Hi-Way Billboards, Inc., supra,; and Goodsell & Vocke, Inc., 223 NLRB 60 (1976). The position taken by the Board is, of course, binding on me. Insurance Agents' International Union AFL-CIO (The Prudential Insurance Company of America), 119 NLRB 768, 773 (1957). Accordingly, I find the circumstance of an ongoing impasse to be an insufficient reason for Bonanno to have withdrawn from the Group. Accordingly, unless the Union went along with the withdrawal (a subject discussed later herein), Bonanno had a continuing duty to participate in group bargaining, a duty which it violated by withdrawing. E. The Continuing Negotiations Shortly after the withdrawal, a Group representative informed the Union by letter dated November 24, 1975, that he understood the Union had been notified that Bonanno had withdrawn. The letter stated that the remainder of the Group would continue to negotiate with the Union and announced that the lockout by the remaining members was being terminated. Thereafter, the Group, without Bonanno, met with the Union and negotiated further on December I, 1975, and February 4, April 5, and April 13, 1976.3 On April 13, 1976, the Union dropped its demand for compensation by commission and accepted a management offer of a revised hourly wage rate. With this development, agreement was finally reached on a new contract. F. The Union's Claim on Bonanno Although the Union had not communicated with Bonanno since its withdrawal, other than to file unfair labor practice charges on April 9, after it reached agreement with the Group on April 13 it claimed that Bonanno also was bound by the terms of the contract bargained. By letter of April 29, 1976, the Union informed Bonanno that the Union at no time had consented to its withdrawal, and that it considered Bonanno to be a member of the Group and bound by the settlement reached. On May 3, 1976, Bonanno's attorney replied to the Union by letter denying it was bound by the agreement reached. G. Union Consent, Acquiescence, and Estoppel Bonanno contends that, even if its withdrawal was untimely and unjustified by unusual circumstances, the Union has gone along with the withdrawal by consenting or acquiescing to it, and in any case should not now be heard to object to it. 1. Consent or acquiescence As to consent, it is clear the Union did not specifically consent at the time of withdrawal. When Charles Bonanno " On Apnl 9, the Union filed the instant unfair labor practice charges against Bonanno. 4 It is not clear how the Union could wash out its antitrust suit against all read the withdrawal letter the Union Field Representative Herbert Salter over the telephone on November 21, 1975, Salter made no comment other than to indicate he would wait to see a copy of the letter before confirming the telephone call and he would probably consult the Union's attorney. This could not reasonably be understood as consent to what Bonanno was doing but only as acknowl- edgment of notice that he was doing it. Up to that point, Charles Bonanno had been a member of the employer bargaining committee. At the first negotiating meeting following withdrawal, Union President William McCarthy inquired as to who had replaced Charles Bonanno on the employer bargaining committee. He thus recognized that Bonanno was in fact not actively participating in the continuing negotiations. But it was not more than that. It did not amount to an agreement with Bonanno's legal position that it could withdraw anymore than continuing negotiations with the balance of the Group amounted to consent to Bonanno's absence. To hold otherwise would give every dissident in group bargaining the power to ruin collective bargaining for all others involved. By negotiating with the balance of the Group and recognizing that Charles Bonanno was no longer on the bargaining committee, the Union only acknowledged the defacto situation. No further reference to Bonanno's absence occurred until the final session on April 13. At the meeting, after agreement was reached on contract terms, an attorney for the Group asked, "What about pending litigation?" He was referring to collateral litigation including an antitrust suit by the Union against the Group, an injunction suit by the Group against the Union, and unemployment compensa- tion cases. He apparently did not intend to include the instant unfair labor practice charges which the Union had filed on April 9 because the Group attorneys were unaware of them. Herbert Salter, speaking for the Union, responded that "we would probably wash all the pending litigation- this does not include Bonanno, they are separate now and not in the group." At that time Bonanno was not represented in the pending litigation by the attorneys for the Group, but was separately represented by the attorneys who later appeared for it in the Board proceeding. Salter's response acknowledged the long-established de facto separation of Bonanno from the Group. But he could not have meant to release Bonanno from its duty to bargain with the group. Unfair labor practice charges based on Bonanno's refusal to bargain with the Group had been filed only 4 days earlier and are still pending in this proceeding. They stand as a constant union assertion that Bonanno is bound to Group bargaining. Respecting the other pending litigation, Salter's response is ambiguous when applied to Bonanno.4 Such ambiguity should be construed in a manner consistent with the Union's position on the pending unfair labor practice charges. On April 29 the Union sent Bonanno a letter denying it had ever consented to its withdrawal and asserting it was bound to the negotiated contract. except Bonanno, nor why it would want to leave Bonanno as the only surviving plaintiff in an injunction suit against the Union. 631 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Considering the above circumstances, I find that the Union did not, directly or by implication, consent to, nor acquiesce in, Bonanno's withdrawal from Group bargain- ing. See Fairmont Foods Company, 196 NLRB 849 (1972); The John J. Corbett Press, Inc., 163 NLRB 154, 158, fn. 14(1967); The Carvel Company, and C and D Plumbing and Heating Company, 226 NLRB I Il 1, fn. 8 (1976). 2. Estoppel Bonanno also contends that the Union (and the General Counsel) should not now be heard to object to the withdrawal because (a) for months following the withdraw- al the Union remained silent and did not affirmatively object; (b) the Union continued bargaining with the balance of the Group; and (c) following the withdrawal the Union accepted the beneficial consequences of the with- drawal; namely, termination of the lockout by other employers in the Group. The Board has already rejected these contentions in Fairmont Foods Company, supra. In sum, I find that Bonanno was obliged to bargain with the Group, that its attempt to withdraw while negotiations were in progress was not timely nor justified by the circumstances, including the ongoing impasse and the selective strike, and since the withdrawal the Union has neither consented to nor acquiesced in the withdrawal nor should it be estopped now from claiming that Bonanno is bound to the agreement reached with the Group. Bonan- no's refusal to honor that agreement is, and has been, a breach of its duty to bargain in good faith and is an unfair labor practice within the meaning of Section 8(a)(5) and (1) of the Act. IIl. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Bonanno set forth in section II, above, occurring in connection with its operations described in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. CONCLUSIONS OF LAW 1. Bonanno is an employer within the meaning of Section 2(2) and is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. The Union is, and has been at all material times, the exclusive bargaining representative of the employees of Bonanno in the following appropriate unit: All linen supply truck drivers and helpers employed by members of the New England Linen Supply Associa- tion, exclusive of all other employees, office clerical employees, guards and all supervisors as defined in Section 2(1 1) of the Act. I In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec. 4. By its refusal to adopt the agreement reached between the Union and the Group bargaining on behalf of members of the New England Linen Supply Association, and by its refusal to give effect to the terms and conditions contained therein, Bonnano engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 5. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Bonanno has engaged in certain unfair labor practices, I recommend it cease and desist therefrom and take certain affirmative action that I find necessary to effectuate the policies of the Act. In this connection Bonnano should immediately sign and imple- ment the agreement reached between the Union and the Group, and, as urged by the General Counsel in his brief, apply it retroactively to April 13, 1976, making its employees whole for any loss of earnings suffered since then as a result of its failure to apply the agreement. See The Carvel Company, supra. Backpay is to be computed in the manner set forth in F. W. Woolworth Company, 90 NLRB 289 (1950), with interest thereon at 6 percent, calculated according to the formula set forth in Isis Plumbing & Heating Co., 138 NLRB 716 (1962). Nothing herein is to be construed as requiring Bonnano to recoup wages or benefits already received by its employees. Bonnano should also preserve and make available to Board agents, upon request, all pertinent records and data necessary in analyzing and determining whatever backpay may be due. It should also post appropriate notices at its Medford, Massachusetts, facilities. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER 5 The Respondent Charles D. Bonanno Linen Service, Inc., Medford, Massachusetts, its officers, agents, succes- sors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively with Teamsters Local Union No. 25, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive bargaining representative of its employees in the appropriate unit described herein. (b) Refusing to sign and to implement the 1976-79 linen supply agreement reached between the above Union and the Group representing employer-members of the New England Linen Supply Association with respect to its employees in the appropriate unit described herein. (c) In any like or related manner interfering with, restraining, or coercing employees in the exercise of their rights under the National Labor Relations Act, as amend- ed. 102.48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes. 632 CHARLES D. BONANNO LINEN SERVICE 2. Take the following affirmative action which will effectuate the policies of the Act: (a) Forthwith sign and implement the above-described agreement and give retroactive effect thereto from April 13, 1976. (b) Make whole its employees in the above-described bargaining unit for any loss of pay or other employment benefits they may have suffered by reason of its refusal to sign and implement the aforesaid agreement, in the manner set forth in the section entitled "The Remedy." (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this Order. (d) Post at its place of business in Medford, Massachu- setts, copies of the attached notice marked "Appendix." 6 Copies of said notice, on forms provided by the Regional Director for Region 1, after being duly signed by Respondent's representative, shall be posted by it immedi- ately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, includ- ing all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director for Region 1, in writing, within 20 days from the date hereof, what steps it has taken to comply herewith. 6 In the event the Board's Order is enforced by a Judgment of the United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT refuse to bargain with Teamsters Local Union No. 25, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, by refusing to sign and implement the 1976-79 contract between the Union and the employer-members of the New England Linen Supply Association. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of their rights under the National Labor Relations Act, as amended. WE WILL forthwith sign and implement the above- mentioned contract and give retroactive effect thereto from April 13, 1976. WE WILL make whole our employees in the bargain- ing unit for any loss of pay or other employment benefits they may have suffered by reason of our refusal to sign and to implement the aforesaid collec- tive-bargaining agreement, plus interest. CHARLES D. BONANNO LINEN SERVICE, INC. 633